If isoquants are drawn as straight lines,it implies that:
A)the two inputs are perfect substitutes for each other.
B)the MRTS is decreasing.
C)that the inputs must be used in fixed proportions.
D)the MRTS is zero.

Question

Quizplus · Accepted Answer

When isoquants are drawn as straight lines, it implies that the two inputs are perfect substitutes for each other. This means that the firm can replace one input with another without changing the level of output, hence the slope of the isoquant is constant. In other words, the marginal rate of technical substitution (MRTS) is equal to the ratio of the prices of the two inputs, which is constant along the isoquant. Therefore, the MRTS is neither decreasing nor zero, and the inputs do not have to be used in fixed proportions.

If Isoquants Are Drawn as Straight Lines,it Implies That